Stiff competition forces Roku to license its software? [Updated]

Following Netgear’s announcement Tuesday that it would offer a $90 set top box powered by Roku’s software, it looks as though Roku is playing with alternative models in an effort to stay competitive. Roku gained notoriety in 2008 by providing an easy solution for streaming Netflix Watch Instantly video content to television sets. The company has since expended its product through partnerships that brought additional content from the likes of Amazon Video On Demand, MLB.TV and Hulu. With a growing content library and three new hardware products starting at just $59.99, Roku still finds in the precarious position of having to compete with the likes of Google, which recently launched Google TV, and Apple, which refreshed its Apple TV offering last month.

In an effort to combat the aforementioned giants, Roku is licensing out its software. The first taker, Netgear, announced the Netgear Roku Player NTV250 earlier this week, which is already available at Best Buy, Radio Shack, Fry’s, Amazon.com and Buy.com. Roku hopes that by letting larger hardware partners do the heavy lifting, it can spread its net as wide as possible and let the simplicity of its software carry partner offerings. There’s no question Roku has a great product, but Google has shown that it plans to be very aggressive with Google TV and Apple sold a quarter-million Apple TVs in just six weeks. Roku tells BGR that its business couldn’t be better right now but with competition like Apple and Google, Roku has its work cut out for it.